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Friday, September 28, 2012

Jurisdiction Week at SCOTUS

Perhaps still traumatized by deciding cases that the media is covering (poorly or otherwise) and the whole nation cares about, the Supreme Court opens its new term on Monday with three cases that only procedure profs could love: federal subject matter jurisdiction, including two involving merits/jurisdiction overlap.

Lozman v. City of Riviera Beach raises the issue of whether a houseboat is a vessel (Mike Dorf has some fun with this in a Hart-and-Fuller, or Scalia-and-Posner, way), both for the merits of a foreclosure claim on a maritime lien and for federal admiralty jurisdiction. The Court may have to deal with some sub-issues, such as how to define "Any civil case of admiralty or maritime jurisdiction" in the jurisdictional grant; whether a merits fact, such as whether something is a "vessel," also goes to jurisdiction; and, if so, the standard of proof for that fact in the jurisdictional context. Kevin Clermont and Dorf  filed an amicus on the subject, arguing that the fact for jurisdictional purposes should be subject to a prima facie standard, as opposed to a preponderance standard for the merits. I will have more to say on this after the argument.

Kiobel v. Royal Dutch Petroleum, held over from last term for reargument, raises the issue of whether a claim can be brought under the Alien Tort Statute against a corporation for extra-territorial conduct. As a preliminary matter, the Court also must consider whether the availability of corporate civil liability is an issue of merits or jurisdiction. I will have more to say on this, as well; I would argue that whether the corporate defendant can be liable is a purely merits question and has nothing to do with the court's jurisdiction.

Kloeckner v. Solis considers where a federal employee must challenge a decision by the Merit Systems Protection Board in a "mixed case" (one raising discrimination and termination issues) in which the Board did not resolve the merits of the discrimination issue--the Federal Circuit (which ordinarily reviews MSPB decisions) or a federal district court (which ordinarily hears discrimination claims). I wrote the case preview for SCOTUSBlog, so I will be coming back to this case over the course of the term.

Posted by Howard Wasserman on September 28, 2012 at 12:47 PM in Civil Procedure, Howard Wasserman, Law and Politics | Permalink

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Prof. Wasserman,

For a jurisdictional statute such as the ATS, what if the Court only decides to address the extraterritoriality question? If they decide that the statute only encompasses torts with a nexus to the United States, would that be jurisdictional rather than going toward the merits? How else could they even bring that issue up sua sponte unless it does go to their subject-matter jurisdiction?

The problem with what I foresee you arguing regarding Morrison and merits is that Sosa emphasized how the ATS is only a jurisdictional statute, but allowed for certain causes of action to be recognized (assaults against ambassadors, safe conducts violations, and piracy). I don't necessarily disagree with you on the more substantive corporate liability question, but it would seem to me that sovereign limitations are normally jurisdictional in nature.

Posted by: Joshua | Sep 28, 2012 7:22:28 PM

Who can be liable and for what they conduct they can be liable both should be merits inquiries. After Morrison, extra-territoriality is part of the "for what" inquiry. Joshua's argument essentially divided those two; I think both are part of the merits inquiry.

After Sosa, § 1350 functionally means the district court has jurisdiction over 1) a tort claim 2) by an alien that 3) arises under the law of nations (as made part of federal common law). That last point should mean something like it does under § 1331--the right allegedly violated "created by" or "made possible by" the law of nations. That clearly is the case in Kiobel, so the court should have jurisdiction.

The two questions that remain--can a corporation be liable and does U.S. law apply extra-territorially--both are about the scope of the federal common law incorporating the law of nations. That is, the scope of the applicable substantive law and should be merits.

Mind you, I am not predicting how the Court will resolve this; I am arguing what I believe is the best approach to this--and certainly the approach that is most consistent with Sosa and Morrison.

Posted by: Howard Wasserman | Sep 28, 2012 8:15:48 PM

Prof. Wasserman,

Thanks so much for the response. I guess my take on the statute is slightly different from yours because, if it is to actually be a jurisdictional statute as Sosa interpreted it, then the question of how far nations extend their adjudicative jurisdiction under customary international law will always fold right back on top of the scope of the statute itself. In other words, does customary international law show other countries whose courts decide disputes with no nexus whatsoever to the forum court? Was that the custom of "civilized" nations when the Judiciary Act of 1789 was enacted? Those answers are fairly obvious and should end the inquiry.

I've thought about this a great deal, and it always sounds circular at first, but the circularity is actually a result of the schizoid holding in Sosa. With one hand, the Court labeled the ATS as purely jurisdictional, but with the other hand, they provide causes of action that the statute also allows plaintiffs to bring suit for. What constitutes those suits is much more of a merits question. Whether a court would have "cognizance" (original ATS language) over a certain type of claim in the late eighteenth century is a jurisdictional inquiry.

To your point, even the questioning at the February oral argument bleeded into how corporations as defendants would very likely be merits questions under any other old statute--just like with Morrison. You don't talk about Pirates, Inc. and the practices in semi-analogous (usually criminal or quasi-criminal) cases from other countries without observing how the wrongs dealt with in those cases are constituted/thought about by other countries. In this way, the Cabranes theory at the court of appeals was too much intertwined with the question of looking at what overseas cases have actually been brought--which will always include an inquiry of who those cases have been brought against.

But I don't think the same can be said of an inquiry looking at whether customary international law shows many other nations allowing for adjudicative jurisdiction. That inherently goes to the power of an adjudicative body to hear and decide a case--a distinctly different inquiry from whether someone sued the proper person under the tort itself.

Just my two cents. If Sosa hadn't put so much of an emphasis on claiming that the ATS was purely jurisdictional, I'd very likely agree with you and think that Morrison's jurisdiction/merits dividing line should control and simply be the end of it.

Posted by: Joshua | Sep 29, 2012 12:01:17 AM

The Kiobel question Joshua raises is all the more urgent after Iqbal, since Iqbal plausibility pleading is appropriate for these issues but is not (in my view) required if the bar is jurisdictional. (contrast Rule 8(a)(2), requiring a 'showing,' with Rule 8(a)(1)).
Section IV.F. of my Note (still on SSRN) deals with the ATS issue, all too briefly. It points out that the 11th Circuit's jurisdictional approach in Sinaltrainal is incoherent, and requires misreading of its own civ-pro precedents. Here is the footnote where I pick a side:
Even though the statute only confers jurisdiction, whether its applicability in a given case is truly a jurisdictional matter is a matter of considerable disagreement. See [Jordan] Shepherd, [95 Minn. L. Rev. 2318], at 2327 n. 72 (“[T]he Sosa Court never explicitly stated whether it was dismissing the claims based on lack of jurisdiction or for failure to state a claim for relief.”). See generally Roe v. Bridgestone Corp., 492 F. Supp. 2d 988, 1002 (S.D. Ind. 2007) (explaining the conundrum, and persuasively rejecting “a standard that blurs the line between subject matter jurisdiction and the sufficiency of a claim on the merits”) (citing Steel Co., 523 U.S. at 89 and Bell, 327 U.S. at 682). Roe shows persuasively that the better approach is to assume jurisdiction, then treat issues about international norms under Rule 12(b)(6). See Shepherd, supra note 8, at 2328-29 (favorably describing Roe).

Posted by: Jim von der Heydt | Sep 29, 2012 8:25:17 PM

Interesting and helpful. I have to quibble with your last point about what is the "better" approach, though. I thought the presumption was that federal courts were of limited jurisdiction--and this should be presumed even more strongly in a case where jurisdiction rests on a statute from 1789. Even Justice Brandeis noted how "the most important thing that federal judges do is not doing."

Posted by: Joshua | Sep 30, 2012 4:43:18 AM

The general limitations on jurisdiction don't create a 'presumption' that 12(b)(1) issues should be found when the heart of the dispute is 12(b)(6) issues. Arbaugh is all about not dismissing based on jurisdiction when the problem is in the substance of the case's facts -- unless Congress has made it very clear that that is the reason to dismiss. The lack of clarity in the 1789 statute is all the more reason to find the bar non-jurisdictional. It's not a reason to consider courts disempowered.

I think the preference for merits dismissals, when a case involves the wrong kind of allegations, is the clear lesson of Morrison: "to ask what conduct §10(b) reaches is to ask what conduct §10(b) prohibits, which is a merits question.... [Subject-matter jurisdiction] presents an issue quite separate from the question whether the allegations the plaintiff makes entitle him to relief."

Posted by: Jim von der Heydt | Sep 30, 2012 6:54:30 AM

Again, we're back to the circularity argument given the exact history and language of this statute.  Correct me if I'm wrong, but one of the corollaries of the point you're relying on Arbaugh for is that a statute “should not be described as jurisdictional” unless Congress has decided to establish jurisdictional consequences to such a rule. Henderson v. Shinseki, 131 S. Ct. 1197, 1203 (2011). The current test, under Henderson, is whether “there is any ‘clear’ indication that Congress wanted the rule to be ‘jurisdictional.’”Id. (citing Arbaugh v. Y & H Corp., 546 U.S. 500, 515-16 (2006)).  I think that this "clear" indication is satisfied for the ATS when it talks about whether "[t]he district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States."
 
Your reading would seem to suggest that if there's an alien suing for a tort, that belongs in federal court.  Once there, then judges can get into whether the tort actually violates the law of nations or a U.S. treaty.  I guess I just think that interpretation is astoundingly broad and cannot be what was intended to be the scope of federal-court jurisdiction. Instead, the jurisdictional question is inextricably intertwined with an analysis of adjudicative jurisdiction under the law of nations or whatever treaty might give federal courts power to hear a new type of case.  They will always fold on top of one another when a court looks at that issue--but this is not true when you look to whether the substantive facts of a case actually fit within a universal international wrong.  Whether something is torture, or piracy, or an assault on an ambassador is a completely different inquiry from the adjudicative jurisdiction question.
 
You'd be exactly right about citing to Morrison if this were actually a statute laying down any real substantive law, but it’s not.  The extraterritoriality problem looks at whether the First Congress imagined that federal courts should be able to hear cases with no American nexus when no other legal system in the world had ever had the power to hear such cases before (and wouldn’t begin to exercise such power until the late twentieth century). 
 
My understanding has always been that subject matter jurisdiction is the power of the court to make decisions on a particular topic.  The extraterritoriality and jurisdictional questions overlap here because the interpretive issue is whether federal courts were empowered by Congress to hear a violation of the law of nations with no connection to the United States when it passed the ATS.
 
Finally, the presumption I'm referring to with regard to limited federal jurisdiction has nothing to do with the FRCP--it simply works hand in glove with how the extraterritoriality canon should affect a court's interpretation of a jurisdictional statute.  I agree with everything you said about Morrison and the merits/jurisdiction distinction under the Securities Exchange Act, but the difference between Morrison and the ATS is that the ATS doesn't actually provide for any causes of action.  Its focus is on providing federal courts with some degree of jurisdiction.  The degree of that jurisdiction depends on customary international law, which not only will provide the causes of action (Sosa indicated that these would be those norms that are universal and obligatory), but also the scope of adjudicative jurisdiction that is customary to most "civilized" nations.  The practice in the rest of the world on that issue is overwhelmingly territorial, or at least bound to those cases with some established "nexus" to the host forum--as Sosa was, given how the DEA orchestrated the kidnapping in that case. 

Posted by: Joshua | Sep 30, 2012 1:25:54 PM

Sorry, I should have been clearer that I agree with you about the ATS on its face. When combined with the principles of Steel Co., separating jurisdiction sharply from merits, it creates a logical snare from which there is no easy escape. I think the solution is to ascribe to the Congress of the time a lack of sophistication on the concepts involved, and to jury-rig a procedure that works with the much-altered pleading requirements of the 20th and 21st centuries.

I think this is doable because the ATS *can* be read to create causes of action as well as jurisdiction: it effectively imports all causes of action from international law. At least, that's the interpretation I give it, to solve the problem. That reading is supported by the fact that the statute was promulgated initially in response to a tort that happened on American soil, with no extraterritoriality involved. It's also supported by the fact that in Arbaugh the Court showed willingness to treat the word jurisdiction as not actually meaning jurisdiction.

As you know, the problem with that history-oriented reading is that the canonical presumption of no-extraterritorial-application returns with a vengeance.

No easy answer doctrinally. But with Iqbal out there it's important to keep cleaning up the border of jurisdiction and merits, even if it means imposing conceptual clarity on Congresses that lacked it.

Posted by: Jim von der Heydt | Oct 1, 2012 8:30:02 AM

Here are a few cases. In my book, there is no practical problem from this doctrinal mare's-nest as long as the court allows jurisdictional discovery, as usually it must when predicate facts are in dispute. But this means that the result in Sinaltrainal (using Iqbal to resolve the case early) is no longer appropriate.


Sarei v. Rio Tinto, PLC, 650 F. Supp. 2d 1004, 1021 n44 (C.D. Cal. 2009) (“[T]he initial jurisdictional inquiry in an [Alien Tort Claims Act] case does not evaluate whether the cause of action will turn out to be well founded in law and fact.”) (quoting Sarei v. Rio Tinto, PLC, 487 F.3d 1193 (9th Cir. 2007) (in turn citing Bell v. Hood, 327 U.S. 678, 682-83 (1946)).

Al-Quraishi v. Nakhla, 728 F. Supp. 2d 702, 716-17, 735 (D. Md. 2010) (using different standards for jurisdiction and merits, and concluding, for example, that before discovery “it is clearly too early to dismiss Defendants on the basis of derivative sovereign immunity”) (citing Schrader v. Hercules, Inc., 489 F. Supp. 159, 161 (W.D. Va. 1980)), rev’d on other grounds sub nom. Al-Quraishi v. L-3 Servs., 657 F.3d 201, 205 (4th Cir. 2011) (“we have accepted as true the plaintiffs’ allegations that the defendants engaged in a conspiracy with military personnel to torture them, abuse them, and cover up those actions”).
See also Doe v. Nestle, S.A., 748 F. Supp. 2d 1057 (C.D. Cal. 2010) (analyzing viability of Alien Torts Statute claim solely under Rule 12(b)(6), without questioning subject-matter jurisdiction); Chowdhury v. Worldtel Bangladesh Hldg., 588 F. Supp. 2d 375, 379 (E.D.N.Y. 2008) (noting in a discussion of Twombly’s applicability “the very substantial issue, one that has recently divided a panel of the Second Circuit, as to whether there are separate tests for analyzing subject matter jurisdiction and failure to state a claim under the [Alien Torts Statute]”) (citing Khulumani v. Barclay National Bank Ltd., 504 F.3d 254 (2d Cir. 2008) (per curiam)).

Posted by: Jim von der Heydt | Oct 1, 2012 8:39:21 AM

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